Power Metal (AIM:POW) Results for the Year Ended 30 September 2022

Audited Financial Results for the Year Ended 30 September 2022

Power Metal Resources plc (LON:POW) the London-listed exploration company seeking large-scale metal discoveries across its global project portfolio announces its consolidated audited results for the year ended 30 September 2022, for the Company and its subsidiaries (together the “Group”).

Highlights from the year under review:


· The year saw the Company complete a number of new acquisitions to advance its global project portfolio whilst in parallel continue to develop and strengthen its existing business interests.

· The dual pathway of proactive exploration of retained project interests continued across multiple projects, alongside the advancement of corporate activities seeking the outright disposal or planned spin-out Initial Public Offering (“IPO”) of certain project interests.

· In Canada, during the financial year and thereafter, the Company continued to acquire new uranium project interests through direct staking and existing project acquisitions in the Athabasca Basin region of Saskatchewan, reflecting the Company’s view that the uranium commodity is to experience a renaissance due to global expansion of nuclear power generation.

· In July 2022, First Class Metals PLC (LON: FMC) listed in London, with Power Metal holding a c.28% interest valued at c.£1.8m on listing. FMC holds the former Power Metal Schreiber-Hemlo project interests, sold to FCM for equity in September 2021.

· In November 2021, the Company completed the acquisition of the Pilot Mountain Project, a tungsten focused project and completing the four-project portfolio of Golden Metal Resources PLC (“GMT”) which raised £750,000 in pre-IPO financing in December 2021 and during the year continued its IPO preparatory work.

· The Company confirmed its continuation into year two of the Authier North/Duval East lithium project earn-in to 100% in July 2022.

· A diamond drill programme was conducted at the Silver Peak project in British Columbia, Canada, demonstrating bonanza grade silver at the project.

· In Africa, a diamond drill programme was also conducted in late 2021/early 2022 at the Haneti Project in Tanzania targeting nickel, copper, and platinum group elements (held with joint venture (“JV”) partner Katoro Gold PLC (LON:KAT). The programme provided additional geological information to enable the JV partners to review and consider next steps exploration.

· Following exploration work at the Kanye Resources JV in Botswana (Ditau and Kalahari Copper Belt Projects), a conditional disposal of the Company’s 50% JV interest back to partner Kavango Resources PLC (LON:KAV) was announced.

· Power Metal signed a conditional acquisition of 56.7% of the shares in Kalahari Key Mineral Exploration Pty Ltd (“KKME”), holder of the Molopo Farms Complex Project (“MFC Project”) in Botswana. Moving loop electromagnetic surveys conducted at the MFC Project in summer 2022 confirmed a major conductor at the T1-6 target where nickel and PGEs had previously been identified in the 20/21 drill programme and led to the accelerated launch of a follow up diamond drill programme at T1-6 and other targets in September 2022.

· Reverse circulation drilling at the Tati Project (“Tati”) in Botswana identified near surface high-grade gold and follow on work confirmed an 8km gold-in-soil anomaly at Tati, leading to the staking of a further prospecting licence to cover the full anomaly footprint.

· In Australia, October 2022 saw the completion of the acquisition of First Development Resources Pty Ltd and its entire gold/copper focused Western Australian exploration interests. This was followed up by the acquisition of the Selta Project then targeting uranium and rare earth elements in the Northern Territory of Australia. The two acquisitions completed the portfolio of First Development Resources PLC, a UK holding company which raised £1,125,000 in pre-IPO financing and during the year undertook IPO preparatory work.

· Finally in Australia, the Company submitted two licence applications in South Australia comprising the Wilan Project then targeting Olympic Dam style mineralisation. During the year one of the licence applications was granted, with a second licence granted post year end.

· The Company closed the financial year with a focus on delivering advanced exploration programmes across its to be retained exploration portfolio, and with acquisition restricted to additional uranium and lithium focused opportunities.


· Total comprehensive loss for the year to 30 September 2022 of £137k (2021: loss of £622k). The reduction in loss from September 2021 is in part due to the capital contribution balance recognised during the year. The capital contribution balance arose on the completion of the capital reorganisation of the Golden Metal Resources Plc group;

· Pre-non-controlling interest total equity of £ 11.7m at the year-end (2021: £6.3 million); and

· Raised £2,070,000 (before issue costs) in new equity financing during the financial year, from a combination of new and existing shareholders, including the Directors. An additional £1,055,978 of cash received by the Company during the year from exercises of Power Metal share warrants and £25,000 of cash received by the Company during the year from exercises of Power Metal share options. £2,148,307 of shares were issued in relation to acquisitions in various investments and projects.

Post-year end

In October 2022, the Company acquired Badger Lake Uranium Property (“Badger Lake”) through claim staking. Badger Lake covers an area of 16.71km2 within the prolific Athabasca Basin. Badger Lake is surrounded by claims held by uranium focussed companies including Orano SA, Hathor Exploration and NexGen Energy Ltd.

In October 2022 the exploration programme over the 100%-owned Thibault Lake, Clearwater and Tait Hill properties completed successfully, resulting in multiple locations of anomalous radioactivity noted across all three properties with rock sample assay results currently awaited. As a result, the Tait Hill property was expanded by 32.42km2 to 110.56km2, based on work results and to include the full extent of the Mullis Lake Target as well as an anomalous lake sediment result.

As part of Owain Morton’s appointment as Non-executive Director on 10 October 2022, Mr Morton was issued with 5 million options to subscribe for new Power Metal Ordinary Shares of 0.1p each at an exercise price of 3.25 pence with a life to expiry of 3 years. The Director Options are subject to a minimum service period of 6 months and may not be exercised until the volume weighted average price of Power Metal shares trades at 5.0 pence for ten consecutive days.

On 12 October 2022 the Company created an Advisor Warrant Pool comprised of 25m warrants over new ordinary shares of 0.1 pence, this was to reflect the growth of the network of advisors and to ensure that those providing valuable support to the Company can share in the exposure to equity upside. The exercise terms of the new warrants are the same as those created for those awarded to team members of the Company in 2022, principally, to acquire new Ordinary Shares at an exercise price of 3.25p per share.

The Adviser Pool Warrants have a life to expiry ending 12 October 2025, save that should the volume weighted average share price (“VWAP”) of the Company exceed 10.0p for five consecutive trading days, Power Metal shall have the right to serve a ten-business day notice on the Adviser Pool warrant holders to exercise and pay for their allocation, or they may be cancelled by the Company. The Advisor Pool Warrants are subject to a share price performance condition and cannot be exercised until the VWAP of the Company has exceeded 5.0p per Ordinary Share for ten consecutive trading days.

In October 2022 the Company confirmed extension of insider Warrants held by Paul Johnson and Ed Shaw, of 20,000,000 and 7,500,000 respectively, and the Company has extended the expiry date on the Insider Warrants to 21 April 2023 to reflect the limitations on exercise.

On 18 November 2022, the Group concluded the 58.7% share capital purchase of Kalahari Key Mineral Exploration Pty Limited (‘KKME’) for total consideration of £807,348 consisting of 46,134,171 new ordinary shares in the Company at a share price of 1.75 pence and warrants with a total fair value of £35,300.

Additionally, in the event, within 2 years, that Kalahari Key or the MFC Project is sold for US$10million or greater, or a joint venture agreement is signed where the potential project spend is US$10million or greater, Power Metal will issue further warrants over 46,134,171 new Ordinary Shares at an exercise price of 5.0p with a 2 year life to expiry. As at 30 September 2022 the above conditions were deemed unlikely to occur and therefore no contingent consideration recognised.

KKME holds a 100% interest in the Molopo Farms Complex Project, where a large scale nickel platinum-group metal discovery is being targeted in southwestern Botswana.

The acquisition meets the definition of a business combination and will be accounted for using the acquisition accounting method in accordance with the Group’s accounting policies.

Details of the fair value of identifiable assets and liabilities acquired purchase consideration and goodwill are as follows:

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For further information please visit https://www.powermetalresources.com/ or contact:

Power Metal Resources plc

Paul Johnson (Chief Executive Officer)

+44 (0) 7766 465 617

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